About 70% of high school students in the U.S. take standardized exit exams, which determine whether they can graduate. The most rigorous of these exams are "standards-based tests" that at least address English and math skills learned from 9th grade on, and in some states focus on specific courses offered at public school.

If a student does not pass all portions of this test after multiple attempts, he or she will not receive a diploma.

Test advocates argue that these exams incentivize students by attaching concrete consequences to a standard of knowledge.

However, a new working paper from the National Bureau of Economic Research claims that rather than benefiting students who might otherwise graduate comparatively underprepared, these standards-based tests account for a 12.5% rise in incarceration rates.

The paper remains neutral on the effectiveness of the exams, but closes by stating "nothing in this paper suggests that exit exams have large positive effects on student learning and productivity growth while they do suggest an important adverse effect for one segment of the population."

As the average state's incarceration rate was 1.6% during the period analyzed, the authors call this potential .2% increase "substantial" and "disturbing."

While "minimum competency" exams that track skills taught before high school have a smaller effect on incarceration rates, they were large enough to also be noted in the report.

The report also found a decline in graduation rates for states that have introduced standards-based testing. According to the authors, the 1% decline is consistent throughout most studies of exit exams.

While the accepted theories of standards-based testing argue that any graduation decline will be fully offset by students getting GEDs, the authors of the study found that any increase in GEDs was too insignificant to make up for graduation decreases.